KPMG: A Clear Data Strategy is the Foundation of Digital Transformation

According to a new study by KPMG, retail leaders who successfully utilize their own and external data and systematically conduct data analysis achieve up to 15 percent higher revenue growth and up to 12 percent greater profitability compared to their competitors. However, despite increasing investments in analytics and digital tools, 68 percent of surveyed companies admit they lack a clear data utilization strategy. Data fragmentation and disconnected systems are among the key challenges limiting transformation in this sector.

The Challenge of Data Overload

The retail sector is undergoing significant transformation, driven by rapid technological advancements and changes in consumer expectations. Today’s customers demand personalized and seamless shopping experiences across all channels, putting pressure on retail companies to not only understand but also anticipate their needs. At the same time, the fragmentation of data ecosystems, as well as the increasing volume and speed of data generation, pose a significant challenge.

Analyzing the aforementioned research, KPMG experts highlighted that retail companies today collect significant amounts of data – from transactional information, purchasing patterns, and social media engagement to loyalty program data. However, the analysis shows that only 52 percent of surveyed retail companies believe they are capable of leveraging this data for strategic decision-making. Additionally, 40 percent of respondents indicate that they lack real-time data analysis tools, leading to inefficient processes and missed sales opportunities.

How Data Can Increase Sales and Improve Inventory Management

Data analysis can significantly enhance several key aspects of business operations. Companies that use data to personalize offers achieve up to 20 percent higher repurchase rates, thereby improving customer experience. Predictive analytics can contribute to greater supply chain efficiency by reducing unnecessary inventory by 30 percent and improving demand forecasting accuracy. Furthermore, smart pricing through dynamic models allows for revenue increases of five to ten percent as prices are optimized according to market trends and consumer behavior.

Challenges of Digitalization in the Retail Sector

Analyzing the research results, Daniel Lenardić, a partner in the Business Consulting Department at KPMG Croatia, part of the KPMG Adria cluster which includes KPMG in Croatia, Bosnia and Herzegovina, and Slovenia, further emphasized the importance of data unification to ensure continuous growth and development in the sector.

– The time when companies could rely on linear growth and occasional price corrections is behind us. Today, retail companies that do not integrate data into their business processes lag behind competitors who use analytics for agile supply chain management, customer experience personalization, and price optimization. Our analysis shows that leading companies in the sector are already achieving concrete financial results thanks to modern data strategies, says Lenardić.

Lenardić also highlighted that it is crucial to invest in tools that enable unified tracking of data from all sales channels – online, offline, social media, loyalty programs, as well as external sources (market analysis, competitor data, etc.).

– Without such integration, companies lose valuable opportunities and make decisions based on incomplete information, which can have significant consequences for long-term profitability, he added.

Further analyzing the state of the domestic market, Matej Samardžić, a manager in the Business Consulting Department at KPMG Croatia, part of the KPMG Adria cluster which includes KPMG in Croatia, Bosnia and Herzegovina, and Slovenia, warned that many Croatian companies still rely on outdated operational models and do not utilize the full potential of data.

– Although data is an extremely valuable resource, its practical application is often hindered by disconnected systems, various sources of information, and a lack of a unified management strategy. Our experience shows that many companies still manually analyze data, often exclusively through MS Excel or use it only in a fragmented manner, without a clear connection to business objectives. Such an approach limits strategic decision-making and diminishes the potential of data to create a competitive advantage, says Samardžić.

Samardžić added that the introduction of automation and artificial intelligence in data analysis has become a necessity.

– Companies that rely solely on historical data and manual processes for trend forecasting are already losing market share. Predictive analytics, which enables inventory optimization, price adjustment, and enhancement of customer experience, must become the standard in the sector, he says.

A clear data strategy is not just a technological initiative – it must become a fundamental business strategy for every retail company that wants to remain competitive in the digital age. Companies that do not invest in a data strategy risk stagnation and a decrease in market share, while those that implement advanced analytical tools achieve measurable benefits through the optimization of operational processes, increased customer loyalty, and long-term sustainability.

– The time for simple solutions is behind us – the retail sector is entering a new era where advanced data analysis, business intelligence, and artificial intelligence will be crucial for survival and growth, concludes Daniel Lenardić.